Can Modular Homes Help Solve America’s Housing Crisis?

While the world praises the United States as a land of opportunity, the U.S. has a number of problems it needs to address, one of which is a growing housing crisis. Mortgage loan company Freddie Mac estimates that 2.5 million additional homes are required to meet current needs. The demand for housing — especially in the affordable housing space — has caused rental prices to skyrocket in major U.S. cities and has put a strain on builders attempting to fill the gap.

To many, this may seem like a crisis, and in part they’re correct, but the housing shortage also presents an opportunity. It’s a chance for some of America’s great minds to demonstrate why this country is known for innovation, progress, and perseverance. In fact, a solution is already in the works that may provide an answer to the U.S. housing shortage: modular homes.

Modular Homes Explained

A modular home differs from a traditional house with regard to its construction type. You’ve likely driven by construction sites for new homes where the site brings in materials and turns them into foundations, frames, and roofs. The home-building process is long, arduous, and expensive. On the other hand, factories create modular homes.

Factories do not construct the house itself, but workers in a controlled environment craft its individual pieces. When they complete all the pieces, they package the pieces together and send them to the building site. All the builder has to do is assemble the pieces together on a secure foundation. Then, they’ll have the modular home is ready for habitation.

Builders build modular homes primarily with wood framing, just as you would see in traditional homes. The addition of light gauge steel gives a modular house the structural integrity it needs to remain stable. While builders must follow local building codes and regulations, a modular home can reach up to five stories while remaining perfectly safe and sound in its design. This kind of simplicity and convenience will help improve the housing crisis.

Pros of Modular Home Building

There are two primary benefits to modular home building. The first benefit is how long it takes to construct a house. Modular homes can be ordered and put together in as little as 16 weeks. Building a home on site will typically take nearly twice as long, if not more, to be ready to move into. With faster building speeds, builders can build more homes in less time, enabling them to chase down the nation’s housing shortage gap.

The next key benefit of modular home building is the price point. While faster speeds make 2.5 million homes a more feasible number to achieve, time doesn’t factor in the exorbitant cost required to manufacture that many dwellings. Modular homes make this goal more feasible, as they cost much less to build than a traditional home. A modular home will cost between $90 to $120 per square foot, while on-site building projects can cost more than $150 per square foot. 

Something else to consider with construction projects is the amount of waste that the process produces. Construction companies inadvertently waste a lot of resources due to simple human error, raising the already ballooning costs of materials. Modular home factories are much more efficient, reducing building errors through the use of precision technology. When builders create material waste they can more easily recycle it, thanks to the controlled environment of a factory setting.

Making Modular Home Building a Reality

Leading the charge for modular homes is Praxis Modular. The company uses robotics and artificial intelligence to mass-produce the pieces needed for modular homes, shipping them to builders across the nation. Although builders and factories mass-produce the houses, a variety of template options allows clients to customize their dream home.

Praxis Modular’s president Jon Stouffer points toward the quality assurance of modular home building as a major housing crisis advantage of the industry. “Our quality is controlled every step in the process,” he explains. “In conventional construction, there will always be inspections for process and procedure as in modular building. However, with conventional construction, those inspections are always after the completion of the process — never during the process.”

Modular homes always pass the test when it comes to quality and efficiency. People can even take down a modular home, place it on a trailer, and move it somewhere. The implications of such technology are staggering.

Modular in the Future

Fabricating building parts in a factory and putting them together on site is not just a concept the industry reserves for residential buildings. Corporate America is taking notice and riding the wave as well. Stouffer notes, “We are also very heavily involved in the hospitality markets for hotel-type buildings. Marriott and Hilton chains are utilizing modular construction in approximately 50% of their buildings today.” This process slashes costs for national chains as they look to expand.

Think of any industry sector, and there’s likely a way modular home building can provide benefit. Stouffer mentions university housing as another large market for modular buildings. As students return to campus following the COVID-19 pandemic, this industry can meet the housing demands with modular apartment complexes. Additionally, builders can construct them in the time it takes a student to complete a semester of classes.

Real estate investment has long been a way for entrepreneurs and businesses to make good use of their money to create passive income. Modular homes present more investment opportunities at a lower buy-in, extending the opportunity to even more individuals. 

While the U.S. housing shortage crisis won’t be solved overnight, modular homes point the way forward. America’s tech giants certainly seem to think so. Between them, Google and Microsoft have invested a combined $530 million in modular home building on the West Coast. As adoption increases, modular homes will present a viable way to close the country’s current housing gap. 

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8 days ago

This site has become so impressively tone deaf.

9 days ago

Modular homes aren’t the answer to the housing shortage in the US. First off, if cost and time to build were primary factors, there wouldn’t be millions of homes sitting empty – as there are today. The problem is the cost of residential land – which has been driven up across the US by zoning and regulation, and sheer population. The ability to put up a home faster and cheaper doesn’t solve the problem of not being able to buy the land in the first place. Less and less plots are available for new homes, which in turn increases demand… Read more »

12 days ago

Yep, the cost of property and rentals is purely a supply and demand issue – makes sense. Those 17,000,000 empty homes must all be just under renovation.

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